UK - Global ratings agency Standard & Poor's plans to publish ratings for UK final salary schemes could go live by the end of March 2004.
The firm first revealed it was looking at rating schemes in July 2002 and last year it created S&P Pension Services, which is headed by its former head of European equity research, Jim MacLachlan.
S&P believes the ratings will give firms, scheme members and investors a clear picture of a pension fund’s health. In addition to the rating, S&P could also offer up to 14 other services, including rating corporate governance policies and DC schemes.
S&P director James Tew said: “We have had to get slow progress through our systems to get the pension business going.
“We now seem to be moving forward – although it has not been formally approved at the moment. We’re also looking at what we can do to make trustees’ lives easier.”
Tew added: “We’re currently making our pitch to senior management – we’d need to recruit staff but hopefully we can do that before Christmas and maybe get the product up and running by end of first quarter.”
Schemes, though, have expressed reservations about S&P’s venture and fear it could put extra pressure on trustees.
A spokesman for the National Association of Pension Funds said: “What’s the reasoning behind setting up this ratings unit? S&P already takes pensions into account when they rate companies.
“Secondly, are schemes or their sponsors going to pay for it? It may also put undue pressure on schemes that already know what their funding levels are like. In a difficult time like this, will it actually be constructive to put further pressure on them?”
Securicor group pensions and benefits manager Sok Wah Lee agreed: “Trustees will keep a close eye on the ratings and look at their competitors to see how they are doing, relatively.
“It will prolong pressures on schemes.”
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